Benefits and problems of registering a company in Taiwan

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Benefits and problems

Benefits of Taiwan company registration

It will be relatively easy for our Clients to setup a business in Taiwan because:

Our Clients may setup a new company with only 1 shareholder and 1 director, who can be of any nationality or residency. Furthermore, if our Clients decide to register a branch or representative office of their existing company, they will not be required to appoint local representatives;

While, there is no minimum paid up share capital requirement by law, Healy Consultants recommends its Clients to deposit at least US$17,000 into the capital account, prior to registering the company. Once the capital is deposited, Healy Consultants can register the company within 3 weeks;

Companies setting up operations in the free trade zone will be allowed to import goods and machinery into the zone without being required to pay certain duties including VAT, customs duty, commodity tax and trade promotion service fee. Similar incentives may also be claimed by companies setting up in economic processing zones, science parks, bonded factories and warehouses;

Companies investing in R&D activities are eligible to claim up to 15% of their expenditure against its income tax liability, although the amount claimed must be less than 30% of its liability for the year;

It is possible for foreign companies to apply for withholding tax exemption on royalty payments being made to a foreign company for usage for their technology in Taiwan. In such a case, a foreign company will require approval from the Industrial Development Bureau (IDB).

The country is situated in a strategic location of the Asia-Pacific region. Thereby, enabling all the companies incorporated in Taiwan to serve to the emerging and dynamic consumer markets of i) Japan; ii)ASEAN; iii) India and China as well as iv) the US.

Problems with Taiwan company registration

Taiwan business documents are written in Chinese, meaning that foreign investors coming from non-Chinese-speaking countries face translation costs and waiting times when registering a business in Taiwan;

Bureaucratic and banking procedures make it necessary for our Clients to travel to Taiwan in order to complete the company incorporation process and open a bank account;

Prior to starting the business registration process, our Clients should be mindful of the Negative Investment List issued by the Taiwanese Government;

Foreign investors will need to register and patent all their products upon completing Taiwan company formation, as copying of foreign intellectual property occurs frequently in greater China;

Taiwanese government plays a big role in daily business, creating many barriers for new businesses in Taiwan. as a result, professional help is valuable when navigating company formation and administration requirements. Healy Consultants is experienced with incorporating and licensing Taiwanese companies and will be happy to help.

Our Clients may also need to mindful of the following miscellaneous issues including:

Renting an office for a newly-formed Taiwanese company is expensive. The average annual rent for an office in Taiwan’s main cities is around US$76 per sq. ft.;

Taiwan ranks 9th among Asian countries with regards to “fluency in English”, limiting foreign entrepreneurs’ ability to communicate with local customers and employees;

The relationship between Taiwan and China means the political landscape may not be entirely stable. Taiwan’s uncertain international status and the growth in China’s regional influence should therefore be taken into account;

Just like Japan, Taiwan is in a seismically active zone, making the country prone to regular tremors and earthquakes. This may disrupt business operations, so our Clients who set up a company in Taiwan should make sure to have business continuity plans in case of such events.

Best uses for a Taiwan company

Taiwan provides an excellent gateway to the leading Asian markets because:

Taiwan is a gateway to other large markets in Asia. With a huge number of international trading companies, port facilities, and supporting banks, Taiwan is an excellent source of trade finance. The strength and dependability of its shipping, infrastructure, and transportation sector attracts the world’s leading shipping companies to its ports;

Taiwan has 7 international ports, and is located a mere 53 hours away from the five major Asia-Pacific harbours (Hong Kong, Manila, Shanghai, Tokyo, and Singapore).

Taiwan is an excellent jurisdiction to setup an industrial company because:

Taiwan is a high income country, with a average GNI per capita of over US$22,000 and potential consumer base of over 23 million people. Furthermore, our Clients should use their local company to reach wealthy Taiwanese market;

Taiwan is a relatively inexpensive country in which to operate, as skilled labour costs are around US$550 per month. Wage inflation in the country is currently low, meaning that businesses are able to grow their profits more quickly than their overheads;

Companies engaging in projects intending to upgrade their industrial facilities will be eligible to apply for loans from the National Development Fund (NDF) in order to finance such undertakings;

The World Bank ranks Taiwan as the 2nd best, 3rd best and 14th best jurisdiction in the world with regards to “getting electricity”, “dealing with construction permits” and “enforcing contracts” respectively;

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Testimonial

“Pirster Pte is happy with the work that Healy Consultants undertook for the company. International incorporation can be fraught with opacity, anxiety and vulnerability - especially if it is being done remotely as we did. Healy Consultants worked really hard to make it transparent, straight forward and confidence-inspiring. I look forward to working with Healey Consultants again on future work and happily recommend them to others.”

Fiona Thompson, Managing Director Pirster Pte.

“We had taken Healy Consultants assistance in incorporating our entities in some of the complicated jurisdictions. Their approach right from the beginning has been very systematic, clear and efficient. It has been a pleasure to work with all of them.”

“Thank you Healy Consultants for swiftly project managing my engagement. From the moment I met you in Singapore Healy Consultants attended to my requirements and specific needs. I am more than satisfied with your service. Moreover, your weekly updates allowed me to continue to focus my attention on my global business while trusting you to deliver as promised.”

“Thank you Healy Consultants, you were instrumental in setting up of my Hong Kong based company, the whole process was completed in a professional and timely manner.”

Terry Skews, CEO Brittany Offshore Limited

“Healy Consultants, a professionally managed firm with clear understanding and knowledge about what client expects from them and delivers the same in a professional and timely manner. Kudos to their team.”

“Incorporating any company is comparable to setting the foundation blocks of your new company building, which you aim to build in the best location available. By choosing Healy Consultants you are laying the perfect foundations.”

“The one word that defines Healy Consultants is perfect professionalism. If you have Healy to set up your business abroad, you could focus on the operational overhead and let Healy take care of the rest. From Incorporation to Taxation, it’s a one stop solution. Rest assured, you will have the best people in the Industry working for you and providing you with the best possible information and suggestions.”

Raja Chakraborty, Director Streamlyn Pte. Ltd.

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Timothy F Kauffman, CEO Trivector Services

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“Healy Consultants were instrumental in the set up of our company. They have continued to provide exceptional support and advice over the years.”

Susan Gunnery, Managing Director Qudoss Group

“Healy Consultants is the best firm that we have ever worked with. Through our entire business relationship we were satisfied with provided level of quality and services. Healy Consultants have been responsive and detail oriented which has allowed us to stay focused on our business and not getting distracted with small details.”